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Share Watch – 6 February 2022

Updated: Sep 25, 2022

A1C Mines (ASX:A1M)

From Stockhead:

Last year, the price of copper rose 33%, but that was just the entree.

Goldman Sachs reckons the red metal will hit a record US$12,000/t over the next month, up from ~$US9,700/t currently. That’s uncomfortably bullish, but even the more mild-mannered analysts are revising their forecasts upwards.

White & Case recently conducted its sixth annual survey of industry participants, with 63 senior decision-makers sharing their thoughts on commodity performance for the year ahead. Copper came out on top by a massive margin.

Late last year A1C Mines (ASX:A1M) picked up the ‘Eloise’ copper mine for ~$25m in cash and shares – and made the move from explorer to miner.

Eloise is a high-grade operating underground mine in North Queensland which has produced 339,000t of copper and 167,000oz of gold since production kicked off in 1996.

December quarter production totalled 8,597dmt of concentrate containing 2,392t of copper at an AISC of A$3.05/lb and AIC of A$3.29/lb for November and December 2021.

This meant an immediate strong cashflow for the company, with sales of 1,818t copper, 945oz gold and 19,654oz silver generating net revenue of $25 million.

And the company’s exploration strategy to extend known resource areas, discover new satellite lodes and extend the mine life beyond five years is paying off – with AIC reporting a 58% increase in contained copper and 55% increase in gold in the quarter.

The updated mineral resource now totals 4.4 million tonnes grading 2.3% copper and 0.7g/t gold containing 103,500 tonnes of copper and 93,300 ounces of gold.

The AIC share price is up almost 100% since this time last year. It ended the December quarter with $29.3 million in cash.

Aeris Resources (ASX:AIS)

Also, keep an eye on Aeris Resources (ASX:AIS), with its Tritton copper mine in the Cobar Basin produced almost 23,000 tonnes in FY21, giving Aeris exposure to record prices for the base metal.

Shareholders have also piled into the stock on the back of the high-grade ‘Constellation’ discovery 45km away, where drilling has struck ripper intersections like 61.6m at 5.12% copper and 12.5m at 11.14% Cu.

It also has exposure to Helix Resources’ (ASX:HLX) emerging discovery at ‘Canbelego’, also in the Cobar.

FY22 production is expected to be lower at between 18,500t and 19,500t.

The company is kicking off the first of three “life extension” projects this year at a cost of $50m, which it hopes will extend mine life to the back end of the decade.

These include the Budgerygar deposit – an extension of the Tritton underground mine – the Avoca Tank underground mine, and Murrawombie Pit cut-back.

Financial indicators

The VIX fear gauge up by 4.53 points since 6 February to 27.75 (oh boy!).

The Dow Jones Industrial Average down 1,009.56 points or 2.88% since 6 February to 34,079.18, the STOXX 600 down 1.34 points or 0.29% to 460.81 and the Shanghai Composite index up 129.32 points or 3.85% to 3,490.76.

Gold up to 1,900.80. US 10-year Treasury Bonds up to 1.928 and oil steady on 91.96. Cryptos Bitcoin down by 3,303 points or 7.94% to 38,295.

ASX 200 up by 101.50 points or 1.43% since 6 February to 7,221.70. The Aussie dollar up to 71.76 US cents.

Carbon Market Spot Prices

LGC $42.50                                                     STC $39.50

ESC $37.75                                                     VEEC $82.50

ACCU $51.50 (steadying out)                          EU ETS €89.47

NZU $NZ84.00                                                UK ETS GBP84.25

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